550.S1 Monetary Commission/14: Telegram
The Chairman of the American Delegation ( Hull ) to the Acting Secretary of State
[Received July 7—7:57 a.m.]
110. For the President from Pittman. I take place of Warburg who has been substituting for me on gold section of Monetary Commission. Some action must be taken this afternoon on our monetary resolution.45 It has been unanimously approved and now will go to the full Monetary Commission. Some statements in it are indefinite while others may be construed contrary to your policy. A motion to reconsider the vote by which it was approved would probably be defeated. Not being able to get it in a parliamentary situation where amendments may be offered I deem it wise to make interpretative statement on behalf of our delegation. One of our delegates holds that resolution is not subject to interpretation I give it. Whether he is right or not the statement will fix the interpretation as far as the United States is concerned. I must have your advice on this matter.
- First, do you want any statement made at all?
- Second, if so indicate changes in statement.
- Third, if there are too many changes hope you will have complete statement redrafted and cabled.
You have won great victory at Conference. Doubt if it is wise to further force gold issue because our allies fear to make the issue at this time and might insist upon weakening your position by compromise. The statement above mentioned on which I desire your advice and action is as follows:
“To the members of the subcommission: Your subcommission has made a favorable report on the monetary resolution introduced by [Page 699] me on behalf of the United States delegation. Your subcommittee has amended the original text of sections (c) and (d) of the resolution as referred to you. These changes may be in accord with the intention as expressed in the original resolution or they may not. You will determine this from the interpretation which follows.
I feel impelled at this time by reason of the action of the Bureau taken on July 6, 1933, and because further consideration may be had by the Monetary Commission to set forth the interpretation intended by the proponents of the resolution and which intention will govern the action of the United States in the event such monetary resolution or any amendment or substitute therefor shall be adopted by the Conference.
Article (b) of the resolution as submitted to your subcommittee provides;
‘That gold should be reestablished as the international measure of exchange values, time and parity being for each country to determine’.
This declaration is limited solely to the settlement of international balance of payments. It [is] exclusive of any suggestion or intent with regard to the standard or measurement of value of national currencies. It is not suggested as a temporary measure or even one to be adopted in the near future. The method or manner of inaugurating such a measure is left for future determination by each government.
The proponents of the resolution did not and do not intend that such gold measure shall be reestablished at a time or in a manner that will obstruct or retard the domestic policies of the United States or that will result in unbeneficial depletion of the gold reserves of the United States or in the hoarding of gold.
The President of the United States has emphatically declared his position in this matter in his public statement under date of July 3, 1933. This policy has been reiterated by the delegation of the United States of America in its statement46 under date of July 5, 1933 filed with the Secretariat General.
I particularly desire to call attention to the interpretation to be placed upon the words ‘time and parity being for each country to determine’ found in section (b). This not only means that each government for itself shall determine the time when it shall adopt gold as a measure of the value of its currencies but that it will from time to time determine and fix such gold parity. The United States is authorized and reserves to itself the right to determine the weight and fineness of the gold dollar and from time to time change and fix the gold content of such gold dollar as the commodity prices and other factors may seem to the United States to judge such determination and action.
The government of the United States is now controlling the possession and use of gold and reserves to itself the right to continue such control in any manner that it may deem proper and legal so long as it is in the interest of the country.
[Page 700]This interpretation is not to be construed as a disinclination on the part of the United States Government to cooperate to the fullest extent with other governments at the opportune time and under equal conditions in the stabilization of international exchange”.
- [Pittman]
- Hull